A luxury tax is a type of tax imposed on goods and services that are considered non-essential or high-end. This tax is typically applied to items like expensive cars, jewelry, and luxury vacations. The goal of a luxury tax is to generate revenue for the government while discouraging excessive spending on luxury items. Luxury taxes can vary by country and may be applied at different rates depending on the item. For example, in the United States, the Luxury Tax was introduced in the 1990s but was repealed due to its negative impact on certain industries. Overall, luxury taxes aim to target wealthier consumers.